Buying and Selling a Home Simultaneously: What Are My Options?

You're ready to move into your forever home…. hooray! So, what do you do with the home you live in now? This is a common question homeowners have when they decide they want to upgrade or move to a new location. It would be nice to buy your new home, move your items in at your pace, then sell the old place- but it's not always that easy. Sometimes the financials don’t allow us to float two homes at the same time. When that is the case there are a few options that you can consider to get through the short term while you sell your home and buy the new one.

Lender Programs: The first step in making this decision is talking to a lender. They will be able to tell you what above your current mortgage that you might qualify for. There are different loan programs that may be available to you. For example, a bridge loan or a home equity line of credit. Sometimes these programs come with high interest or fees, so it is important to know if it is worth the price.

Align Closing Dates: This can be a bit risky, but for those of us who like to live on the edge,

sometimes it can work out just right. If you can manage to get your current home to close a few weeks after your new home closes, kudos to you! Even if the contract dates appear that way, these dates are subject to change and frequently do. You may want a backup plan in case the stars don’t all align.

Contract Contingencies: When constructing an offer, consider writing in a contingency stating that you have the option to back out if your home doesn’t sell within a specified time frame.

If you choose to list your home first, you can also document a contingency upon finding suitable housing, or a lease back clause while you find a new home.

The acceptability of these clauses really depends on the right market and the right buyer/seller. It's also important to note that sometimes these contingencies can still allow the home to get sold from under you, so be sure you know the terms of the agreement.

Temporary Housing: Preparing for a short-term rental or planning to stay with family during the sale can prevent you from dealing with contract fall outs or being outbid. This although sometimes can be tedious, is often a good way to manage the sale so that you aren’t’ floating two mortgages, strapping yourself to thin, and aren’t living on a prayer.

Buying and selling a home is a big deal- probably one of the most expensive, if not the most expensive purchase of your life. Make sure you plan it out and get the facts so you can make the most informed decision with the options you have at the time.

Happy selling!

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